The Entertainment Sector in CARICOM

Key Challenges and Proposals for Action

Ramesh Chaitoo

Inter-American Development Bank

Integration and Trade Sector

TECHNICAL NOTE

No. IDB-TN-514

April 2013

The Entertainment Sector in CARICOM

Key Challenges and Proposals for Action

Ramesh Chaitoo

Inter-American Development Bank

2013

http://www.iadb.org The opinions expressed in this publication are those of the authors and do not necessarily reflect the views of the Inter-American Development Bank, its Board of Directors, or the countries they represent. The unauthorized commercial use of Bank documents is prohibited and may be punishable under the Bank's policies and/or applicable laws. Copyright © Inter-American Development Bank. All rights reserved; may be freely reproduced for any non-commercial purpose.

2013

Cataloging-in-Publication data provided by the Inter-American Development Bank Felipe Herrera Library Chaitoo, Ramesh. The entertainment sector in Caricom: key challenges and proposals for action / Ramesh Chaitoo. p. cm. (IDB Technical Note ; 514) Includes bibliographical references. 1. Cultural industries—Caribbean Area. 2. Culture—Economic aspects—Caribbean Area. I. Inter-American Development Bank. Integration and Trade Sector. II. Title. III. Series. IDB-TN-514

Abstract

Although small in terms of population, the Caribbean is renowned for its creativity. Its cultural

diversity is manifested in a variety of artistic expressions including folklore, crafts,

performances, music festivals, and carnivals. Despite the Caribbean’s great potential in the

entertainment sector, important domestic challenges - emanating from both public and private

sectors - have long impeded the successful growth of creative industries. The paper explains how

the implementation of the Economic Partnership Agreement with the European Union should

serve as an impetus for stakeholders in the region to address these barriers thereby creating

favorable conditions for the production and export of Caribbean entertainment services.

This Study presents an overview of policies in the creative sector in terms of the promotion of

services exports in selected CARICOM states: Barbados, Jamaica, and Trinidad and Tobago.

This Technical Note highlights bottlenecks to implementation of recommendations proposed in

existing analyses and diagnostics and suggests specific ways in which these can be overcome. It

formulates concrete recommendations for relevant actors, including donors and domestic

governments, to promote the development of the creative industries.

JEL Codes: F10, F13, F15

Keywords: Entertainment Services, Creative industries, Trade in services, CARICOM.

TABLE OF CONTENTS

I. Introduction ....................................................................................................................................................... 4

II. The Entertainment Sector and Economic Value .............................................................................................. 6

III. Main Issues Affecting the Entertainment Sector .......................................................................................... 11

IV. Overview of the Entertainment Sector in Selected CARICOM States......................................................... 15

V. Deficiencies in the Regulatory/Policy Framework ........................................................................................ 23

VI. Key Policy Challenges Facing the Entertainment Sector ............................................................................. 29

VII. Market Access for CARICOM Entertainers in Europe under the EPA ...................................................... 34

VIII. Proposals for Actions for the Entertainment Sector .................................................................................. 39

REFERENCES ...................................................................................................................................................... 49

Annex I Roadmap for a Trade Promotion and Marketing Program in Select European States ....................... 53

Annex II Entities with which International Donors Can Discuss Entertainment Projects in CARICOM

States .................................................................................................................................................. 56

LIST OF ACRONYMS

ATA Admission Temporaire/Temporary Admission

BCSI Barbados Coalition of Service Industries

BNDES Brazilian Development Bank

CARICOM Caribbean Community

CARIFESTA Caribbean Festival of Arts

CARIFORUM Caribbean Forum (of the African, Caribbean, and Pacific Group of States

(ACP), namely CARICOM and the Dominican Republic)

CBU Caribbean Broadcasting Union

CET Common external tariff

COTED Council for Trade and Economic Development

CRNM Caribbean Regional Negotiating Machinery

CSME Caribbean Single Market and Economy

CSS Contractual Service Suppliers

CXC Caribbean Examinations Council

EC European Commission

ECLAC United Nations Economic Commission for Latin America and the Caribbean

ENT Economic needs test

EPA Economic Partnership Agreement (between CARIFORUM and the European

Union)

EU European Union

ICT Information and communication technologies

IDB Inter-American Development Bank

IFCIC Institut pour le Financement du Cinéma et des Industries Culturelles

ILO International Labour Organization

ITC International Trade Centre

JAMPRO Trade and Investment Jamaica

JVPA Jamaica Film and Video Producers’ Association

MIDEM Marché International du Disque et de l’Edition Musicale

NCDF National Carnival Development Foundation

ODCs Other duties and charges

OECS Organisation of Eastern Caribbean States

OTN Office of Trade Negotiations

RCC Regional Culture Committee

TTCSI Trinidad and Tobago Coalition of Services Industries

UK United Kingdom

UNCTAD United Nations Conference on Trade and Development

UNDP United Nations Development Programme

UNESCO United Nations Educational, Scientific, and Cultural Organization

U.S. United States

UTT University of Trinidad and Tobago

WIPO World Intellectual Property Organization

WOMEX World Music Expo

WTO World Trade Organization

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I. Introduction

The Trinidadian musical group Lovey’s String Band toured New York and was recorded in 1912, at least

five years before the first jazz recordings were made. This trend continued in the pre-World War II period

in 1934, when Roaring Lion and Atilla the Hun, two calypsonians, performed live on the U.S. commercial

broadcasting television network the National Broadcasting Company (NBC) during prime time, and

recorded 16 songs for an album released by RCA. Meanwhile, Harry Belafonte’s album entitled

“Calypso," which featured many calypsos from Trinidad, was the first LP to sell 1 million copies in the

United States in 1956. (Burke, 2010).

Background

The Caribbean Community (CARICOM) region, although small in terms of population, is renowned

for its creativity. It is culturally diverse, which distinguishes it as an interesting and complex cultural

location. This cultural diversity manifests itself in a variety of creative forms, the most famous being

music (reggae, dancehall, calypso, soca, and chutney). The range of artistic expression includes

folklore, crafts, performances, music festivals, and carnivals. In trading terms, Caribbean cultural

products and services have become marketable items for export on the international scene. Several

Caribbean musicians and other artists have attained global significance and fame in the past quarter

of a century. The iconic Bob Marley is still one of the best-known and best-selling dead artists in the

world, and his music appeals to various generations. Jamaica is known for its reggae music and later

genres, while Trinidad and Tobago is famous for its Carnival. It is also a well-known fact that

Trinidad’s Peter Minshall designed the opening ceremonies for the Barcelona and Los Angeles

Olympics. More recently, Rihanna was the first Barbadian to win a Grammy.

The creative industries in CARICOM constitute a significant sector with substantial economic

value and an increasing source of exports. Research from the early 1990s indicates that the Jamaican

music industry employs about 15,000 people and accounts for 15-20 percent of the USD 300 million

in reggae music sales. Furthermore, the contribution of carnivals and other festivals is very

significant in local economies; moreover, Trinidad-style carnivals have been “exported” to Canada,

the United States, and the United Kingdom (UK).1 There are projections for significant growth of the

Caribbean music industry with increasing exports. There is also keen interest in the development of a

Caribbean film industry that not only has indigenous relevance, but can also sell abroad and

collaborates with and invites internationally established productions to come to the Caribbean.

1 See Caribbean Export, “The Caribbean Music Industry,” Trade Wins, Vol. 1, No. 7, 2001.

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The visual and performing arts also have the potential to grow and become net exporters, but

they have very little support from governments. In addition, most companies need training in

business management and techniques so that they can better manage the financial aspects of their

operation. However, the cost of input into their activities is high, largely due to government measures

at the borders. Governments in the region do not subscribe to the ATA Carnet system, so it is

prohibitive to move visual art across the region. The ATA Carnet is an international customs

document that allows the holder to temporarily (up to one year) import goods without payment of

normally applicable duties and taxes, including value-added taxes. Carnets apply to three broad

categories of merchandise: commercial samples, professional equipment, and goods for use at

exhibitions and fairs. 2

The CARICOM states and the Dominican Republic made the culture/entertainment sector a

major negotiating issue in the negotiations toward an Economic Partnership Agreement (EPA) with

the European Union. It is now time to put in place strategies and concrete actions to take advantage of

the market access granted by European countries.

Around the world, the cultural or creative industries have increasingly been perceived as an

economic sector in their own right. In the UK, a “Minister for Creative Industries” was appointed in

2005. France set up comprehensive special framework programs, and, in 2006, the European

Commission published a 300-page study on the economic importance of the cultural sector. These

developments indicate the emergence of important policy strategies with specific focal points and

profiles. Public players from Brazil, China, India, and Australia have organized national and

international expert conferences on the topic and have founded new research institutions specializing

in creative industries. More recently, organizations such as the ITC, OECD, World Bank, WIPO,

ILO, UNESCO, and UNCTAD have increasingly addressed the topic. When the European Ministers

for Culture and the Media met in Berlin in February 2007, a great number of European states pressed

for more emphasis on the topic. For the first time in decades, cultural/creative industries have gained

priority on national agendas.

2 The Carnet eliminates the need to purchase temporary import bonds. As long as the goods are re-exported within the allotted time frame, no duties or taxes are due. Failure to re-export all of the goods listed on the Carnet results in the need to pay the applicable duties. Failure to remit those duties

results in a claim from the foreign customs service to the importer’s home country. More than 70 countries now subscribe to this regime, which was

introduced in 1961. The acronym ATA is a combination of French and English phrases: Admission Temporaire/Temporary Admission. For details, see:

www.iccwbo.org/ata/id36365/index.html.

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The critical need for various economies in CARICOM to transition to new economic activities

and diversify their products and services and export structures has been evident for several years.

More recently, some countries have been paying closer attention to the creative or cultural industries

as a sector with potential for growth and employment creation. In CARICOM, the sector varies

significantly from country to country, and its economic impact is most evident in the larger

economies ― Barbados, Jamaica, and Trinidad and Tobago. But there have been a few very

significant successes on the smaller islands as well, particularly in the case of music. 3

The creative or cultural industries are often referred to loosely as the entertainment sector. For

the purposes of this paper, the broad entertainment sector in the Caribbean will be deemed to include

the following sub-sectors of activity:

1. The Music Industry, including recording, live performance, and music publishing

2. Film and Television, including on-location productions

3. The Book and Magazine publishing industry

4. The Performing Arts

5. The Visual Arts

6. Festivals and Cultural Tourism

7. Fashion and Glamor

This note will focus mainly on music, the audio-visual industry, and festivals, for which there

are more data and more commercially developed practitioners.

This paper will first provide a brief overview of the creative industries in selected CARICOM

states (Barbados, Jamaica, and Trinidad and Tobago). It will then review the current and past policies

in the creative sector in terms of the promotion of services exports, and will explain their results and

lessons to be drawn. Next, it will point out the bottlenecks to implementation of recommendations in

existing analyses and diagnostics on the matter and propose specific ways in which these can be

overcome. Finally, it will propose concrete measures that could be taken by the relevant actors,

including donors and domestic governments, to promote the development of the creative sector.

II. The Entertainment Sector and Economic Value

It should be noted that attempts by governments to promote exports of entertainment services from

the CARICOM region are relatively new. Most countries have started looking seriously at this issue

3 The international hit song “Turn Me On,” by Kevin Lyttle of St. Vincent and the Grenadines, is a well-known example.

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within the past 5-7 years, although some had focused generally on the cultural sector earlier. In fact,

it was only quite recently that the culture-trade interface surfaced in policy circles in CARICOM.

The key drivers of the creative economy may be considered to be as follows:

1. Consumption dynamics

2. Innovation

3. Technology

4. Talent

5. Diversity

6. Social capital and collaboration

7. Capital investment and marketing

The Caribbean scores highly in terms of talent and diversity, but other areas are a great

challenge. The most critical are the lack of capital investment and marketing, technology, and

social capital and collaboration. These are the areas that need attention in any export strategy for the

entertainment sector.

Why Invest in Cultural Industries or the Entertainment Sector?

Government and donor investment and support to the entertainment industry can be justified

on several levels:

Economic

The cultural industries provide alternative avenues for industrial development, and, as such, they can

broaden the economic base of CARICOM economies. They generate employment and provide a

range of new and interesting career options for thousands of young people. They also generate

foreign exchange from the export of cultural products and services as well as from visitor expenditure

during the festival periods. Moreover they diversify revenue streams for enterprises and entrepreneurs

in supporting sectors and stimulate growth directly and indirectly in other sectors of the economy.

Market-Oriented

Cultural industries can enhance the image of CARICOM economies and help to create one of the

premier destinations in the world. They can attract positive media attention to CARICOM economies

and provide a solid platform for destination marketing. This, in turn, can act as a demand-pull for

investors to CARICOM economies.

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Socio-Cultural

Vibrant cultural industries promote self-worth, build the cultural confidence of the society, and

promote cohesion. They also encourage innovation and creativity within a society and build cultural

competencies to create a set of indigenous skills that are difficult to replicate. Cultural industries

stimulate regeneration of a location or a region: the annual Carnival has created an image of Trinidad

and Tobago as one of the trendiest destinations in the Americas and, in some quarters, as the

“entertainment capital” of the English-speaking Caribbean. This perception has positive implications

for destination branding and marketing.

Cultural industries effectively cross-fertilize with levels of education to provide teaching aids

and resources for other disciplines, to widen the options for curricula development, and to provide

alternative avenues of education and training for the young unemployed. They also reinforce the

heritage and cultural fabric of a society, since the underlying skills in any cultural industry are

derived from the art, culture, and heritage of the country. Raw talent will always be critical to the

success of the cultural industries. Finally, the cultural industries stimulate development of a society’s

heritage through the construction of theaters, museums, art galleries, and cultural villages.

The experience of countries that have successfully promoted their domestic cultural industries

shows that this sector can contribute to skill-intensive, high value-added activities that generate rich

upstream and downstream linkages with ancillary sectors throughout the economy, including

information and communication technologies (ICT) and design capacities. In regional and

international deliberations on the subject, CARICOM governments should acknowledge the

development potential of the cultural industries and ensure that there is an appropriate balance

between policies regarding the protection of culture and heritage and the promotion of market access

for their producers globally.

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The Potential to Increase Employment

Some of the different types of jobs in the sector are listed in Table 1. Some are fungible skills and

relate to various activities across the different sub-sectors. It is important to stress that many young

people are attracted by employment in the creative sector, and, in the Caribbean, young people

comprise the vast majority of most national populations.

Table 1. Categories of Employment in the Entertainment Sector

Performers/Artists

Dancers

Singers

Musicians

Songwriters

Actors

Poets

Radio/TV hosts

Disc jockeys (Deejays)

Producers of Media/Audio-Visual Content

Music studios/labels

Film studios/producers

Directors

Graphic artists/designers

Web designers

Animators

Writers

Editors

Recording/sound engineers

Sound reinforcement providers

Camera operators

Lighting technicians

Location managers

Set designers

Props management

Carnival

Band leaders

Costume designers

Wirebenders

Purchasers/buyers

Booking agents

Representation/Management

Show promoters

Show producers

Stage managers

Set designers

Choreographers

Make-up artists

Personal and business managers

Personal and business managers

Tour managers

Agents and publicists

Public events managers

Intellectual property lawyers

Publishers

Distributors/retailers

Source: Author.

There is a lot of untapped potential in the cultural/creative industries to create growth and jobs

if new overseas markets are targeted in a sustained and cohesive manner. To do so, CARICOM

governments and the private sector must identify and invest in new sources of smart, sustainable, and

inclusive growth drivers to stimulate the sector. Much of the Caribbean’s future prosperity will

depend on how these governments and the private sector use their resources, knowledge, and creative

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talent to spur innovation. Building on their relatively rich and diverse culture, Caribbean people could

pioneer new ways of creating value added, but also of working together and sharing resources.

Technology and the availability of broadband infrastructure in urban and rural areas open up

new opportunities for creators to produce and distribute their works to a wider public at a lower cost,

independently of physical and geographical constraints. Provided that information and

communication technologies are used to the fullest extent by cultural content providers and

traditional patterns of production and distribution are reassessed, creators will have potentially larger

audiences and markets and there will be a more diverse cultural offering for citizens. At the same

time, the roll-out of ICT depends on the availability of high-quality and diversified cultural content.

Cultural content, therefore, plays a leading role in the acceptance of these new technologies by the

wider public and in the development of the e-skills and media literacy levels of CARICOM citizens.

This new environment substantially changes traditional production and consumption models,

challenging the system through which the creative community has, up to now, drawn value from

content. The impact differs widely from business to business and is influenced by where a given

business stands in the value chain. Economic value is being displaced toward the end of the chain,

which, in certain sectors, affects the effective reward for creation. Moreover, parts of the content

industries, particularly the recorded content industries, have been severely hit by piracy and losses in

sales of physical supports (e.g., CDs and DVDs), which have damaged their development, shrunk

their revenue basis, and consequently limited their potential to generate jobs and investment. This is

why the industry also needs to develop new and innovative business models.

The Role of the West Indian Diaspora

There is a strong diaspora element in the export of most entertainment services from the Caribbean

region. Indeed, Nottinghill Carnival in the UK, Brooklyn Carnival, and Caribana in Toronto are

major events that provide opportunities for live performances by artists from the Caribbean (mostly

soca and calypso music). Caribana is driven by West Indians based in Toronto, and, in terms of

entertainers, it is mainly Trinidadians and some Jamaicans who perform at various venues. Very few

entertainers from the Organisation of Eastern Caribbean States (OECS) countries and Barbados take

part in Caribana. Perhaps this is because Caribana takes place in August, which clashes with carnivals

in the OECS countries and Barbados. The Brooklyn Carnival, which takes place on Labor Day

weekend in the U.S., may be more accessible.

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While the West Indian populations in major cities in Europe and North America provide the

impetus in terms of demand for Caribbean cultural expression, there is no indication that the diaspora

is a source of investment in the sector in these populations’ home territories. In fact, what has evolved

in the past 20 years is greater development of the economic and creative activities for carnivals in

London, Toronto, and New York by West Indian immigrants that live in these cities. In addition,

musicians are also emerging in these locations to supply the music and entertainment that accompany

carnivals. There are cost reasons for this, since it is much cheaper to hire local performers than to

bring entertainers from the Caribbean.4 Nevertheless, the main concert events related to the diaspora

carnivals still feature the famous and popular artists from the Caribbean. An interesting pattern is the

increasing numbers of West Indians who go to the carnivals and related events in the metropoles to

consume entertainment services there. Therefore, technically speaking, they are importing such

services rather than exporting them. Of course, increasing numbers of West Indian immigrants living

in European and North American cities also return to the Caribbean for carnivals and other festivals,

and there is some evidence that they contribute significantly to the local economies.

But, to contribute to significant export earnings, Caribbean creative entrepreneurs have to

look beyond their diaspora communities and appeal to wider audiences. If not, they will be limited to

relatively small niche markets in large economies, and there is little potential for significant growth in

these tiny markets. The exponential growth in the success of Rihanna from Barbados, who is signed

to a major record label and sings mainstream pop music, is a case in point.

III. Main Issues Affecting the Entertainment Sector

In 2006, a landmark and comprehensive study of the cultural industries in Caribbean Forum

(CARIFORUM) states, commissioned by the Caribbean Regional Negotiating Machinery (CRNM)5,

recognized that governments and the corporate sector in most Caribbean countries have not fully

appreciated the new directions in the global economy and the ways in which their economies can

diversify to meet new challenges and take advantage of emerging opportunities (Nurse et al., 1997).

It revealed that, although the cultural industries account for a significant amount of employment and

value added, they are not seriously regarded as an economic sector, the key stakeholders in the

4 This is even the case in music festivals in European cities in which there are music bands composed of immigrants from numerous different countries who play their traditional music. But, unlike North American festivals, European events often benefit from much greater public subsidies, which

continue to make it possible to showcase world musical artists who live and work in their home territories. Concerts in Canada and the U.S. must be

totally commercially viable. 5 The CRNM is now known as the Office for Trade Negotiations (OTN) of the CARICOM Secretariat.

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industries are poorly organized, and the sector’s economic value remains largely undocumented. In

this context, policy measures have typically been absent, and, when there have been investments and

initiatives, they have tended to be short-lived, piecemeal, or ad hoc and misdirected. Changing the

mindset of the governments and the corporate sector is key to transforming the sector’s viability, but

it is equally important for the industry stakeholders to become better organized and provide a more

sustained and cohesive advocacy campaign to promote their interests.

While the entertainment sector makes a valuable contribution to the Caribbean economy,

information on its importance remains limited. Consequently, the sector has not been prioritized in

government economic policy formulation throughout the region. The sector has achieved some

measure of export success, but it is far from maximizing the emerging economic opportunities. The

competitiveness of the Caribbean is also threatened by the rapid changes in technologies and the

accompanying transformations in business models. All CARICOM states need investment in cultural

industries because the domestic capital base is inadequate. Furthermore, convergence of media and

ICT is important for marketing cultural products and services.

Cultural industry stakeholders from all sub-sectors have pointed out that the kinds of

incentives that are granted to manufacturing are not granted to cultural industries. Yet, the latter also

export products and services. Furthermore, the ability to export for the first time requires technology

and equipment of high quality, but the high charges for such equipment are major disincentives to

investing in them. The rationale for some tariff rates in the Common External Tariff is also unclear.

For instance, the border taxes applied on cut paper for printing in some CARICOM states amount to

20 percent, but there is a zero tariff on printed books imported into the region. This simple measure

has largely led to the migration of the publishing industry to other locations. Most textbooks for the

Caribbean Examinations Council (CXC) curricula, which are used all over the region, are published

in Asia, and two publishers in Trinidad and Tobago have indicated that the main reason for this is the

tariff on cut paper, which is a significant input cost for the publishing sector.

Recommendations from Previous Studies and Consultations

The key recommended actions for fostering a regional environment conducive to the development of

the creative industries in CARICOM states include the following:6

6 See Nurse et al (2007); James (2007); Burke et al (2009); Hoagland (2007); Sinclair (2009); Stanbury (2003).

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Government Agencies

1. Create an enabling environment for creative industries through the development,

implementation, and harmonization of government policies on trade, industrial, and

intellectual property policies relevant to the sector.

2. Invest in better facilities or infrastructure for the creation of music and the performing

arts in general. In some countries, there are no decent venues for artists of any kind to

practice or perform.

3. Introduce incentive regimes specific to creative industries, for example, tax incentives to

individual artists, tax concessions to purchasers of Caribbean creative products, and tax

and duty waivers for importers of specialized equipment and material that are used as

inputs into the creative process or productions.

4. Upgrade the human resource capabilities of the cultural sector through technical training

in the arts at the secondary and tertiary educational levels, as well as training in arts

administration, management, and cultural entrepreneurship. Increase funding and human

resources for regional art institutes and forge alliances with similar institutions overseas.

Increase scholarships for training.

5. Preserve or introduce proactive policies aimed at promoting cultural diversity and

investment in the cultural sector through bilateral and multilateral negotiations (e.g.,

WTO) and through inter-regional arrangements, for example, negotiation of improved

market access to trading-partner markets.

6. Harmonize, simplify, and implement intra-regional trade measures to facilitate the

deepening of the regional market for cultural goods and services (e.g., common customs

regimes and procedures, and skilled national certification procedures). Key issues are the

freedom of movement of cultural workers and equipment, the expansion of the number of

professionals listed in the category, and greater precision in defining their function.

7. Remove or reduce tariffs or duties and taxes on inputs for creative products and services.

8. Adopt the international Carnet system by CARICOM governments to facilitate less costly

movement of cultural goods for exhibition and promotion overseas.

9. Enter into double-taxation treaties with trading partners to address the issue of

withholding taxes on entertainment contracts for Caribbean artists that perform overseas.

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Oblige the inclusion of specific provisions on cultural goods and services in investment

promotion contracts for investors in the Caribbean.

10. Increase public-private consultation in culture-related policymaking and in the training of

officials on the particularities of creative industries. Increase stakeholder awareness-

building initiatives on the policies that affect the creative industries.

11. Improve data collection systems and documentation of the economic impact of the

cultural industries to establish benchmarks, targets, and policy measures to promote

employment generation, enterprise development, industrial upgrading, and export

expansion.

12. Increase local and regional content on the airwaves (e.g., radio and TV) through local

content legislation/regulation, where needed. Encourage and facilitate the “uploading” of

local and regional content onto the World Wide Web, for example, through the

webcasting of festivals and events.

Public-Private Partnerships (Governments and Cultural Professionals)

13. Develop cultural industry associations to represent the interests of the sector and to

develop a code of ethics and standards for remuneration rates and work practice,

particularly for cultural workers that provide services to private investors. Incentives

should be provided by donors or governments for the establishment of such entities, and

funding should be allocated to defray the costs of their operation, where necessary.

14. Improve access to financing, credit, and business support services for emerging and

export-ready firms and artists, and educate financiers on valuing intellectual capital.

Establish booking agencies and trade/export facilitation centers. These measures should

be matched by market development grants and financing for participation in trade fairs.

15. Improve anti-piracy initiatives and public awareness campaigns in the regional and

diasporic markets for protecting the copyrights of creative products and services.

National and regional rights management centers need to be established for multiple areas

of the cultural industries (e.g., music, book publishing, and the visual arts). The

prevention of copyright exploitation, and protection and collective administration are

vital components of the industrial and export agenda.

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16. Develop and execute strategies for increased linkages between the cultural industries and

the wider economy, for example, distribution, education, financial services, and tourism.

With regard to tourism, this could be done through festivals such as the Caribbean

Festival of Arts (CARIFESTA), which needs to be significantly revamped. Facilitate and

encourage new marketing strategies targeted at the diasporic and intra-regional markets

as well as cultural tourists.

17. Improve accessibility to broadband Internet services to facilitate alternative broadcasting,

marketing, and distribution of cultural goods, services, and events. Establish a stronger e-

commerce platform and a regional warehousing and fulfillment system for the sale and

distribution of cultural goods and services.

18. Invest in marketing and branding of the region’s cultural industries. The Caribbean

already enjoys a lot of market appeal. This needs to be translated into stronger

commercial opportunities for distribution over the Internet as well as expanded

destination branding for cultural tourism.

IV. Overview of the Entertainment Sector in Selected CARICOM States

The Music Industry

The factors that the Caribbean region possesses with respect to the development of the music sector

are:

An abundance of natural talent

A rich history of creative expression and diffusion

A significant diaspora that resides in many countries throughout the world

A resilience of the industry despite little corporate support

A high public-relations profile throughout the rest of the world in the case of Jamaica

Relatively low internal operating costs with respect to the further development of the

industry

Most music from CARICOM countries would be classified as World Music. This occupies a

small but unique niche in the USD 79.1 billion global music industry. Table 2 contains estimates of

the gross spending on World Music in the three sub-sectors discussed previously, the recording

industry, music publishing, and live music. The total spending of USD 1.4 billion represents 1.8

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percent of the global industry. As the table shows, the estimated turnover of the market is dominated

by sub-sector three, live music. Within that sub-sector, the notable feature has been the strong growth

in the number of summer festivals specializing in World Music over the last decade, especially in

Europe.

Table 2. Turnover of the World Music Market 2006 (USD Million)

Recording industry 540

Music publishing 60

Live music 800

Total 1,400

Source: Laing, 2009.

The music publishing sector is weak mainly because of the very limited airplay for the genre,

and the sales of World Music recordings represent an average of about 2 percent of the total market

in North America, Western Europe, and Japan. Given the importance of live performances in World

Music earnings, it is critical for entertainers from CARICOM to expand their base and explore new

markets in the European Union. To date, only the well-known artists perform in European music

festivals.

Trinidad and Tobago

The 2006 Strategic Plan for the Entertainment Industry of Trinidad and Tobago indicated that

approximately 1,000 artists were regularly involved in the recording business and that approximately

3,000 artists were regularly involved in live performances. There are no available data with regard to

sales units, sales value, or annual output of singles and album titles, but Earl Crosby of Crosby’s

Music Centre Limited, an established distributor and retail operator, suggests that an average of 30

albums are produced annually in Trinidad and Tobago. He also indicated that, in the 1980s, there

were no less than seven active retailers and distributors in the New York area alone specializing in

music from Trinidad and Tobago. But digital downloads have long since reduced that number

(Stanbury, 2006).

The indigenous music industry in Trinidad and Tobago exhibits particular characteristics.

While it is very vibrant, the sector consists primarily of small and micro enterprises operating in a

largely unregulated market. Most recordings are produced in small or home-based studios in Trinidad

and the Caribbean diaspora. The majority of the enterprises have limited access to technological and

17

human resources, are self-financing, and exist in the informal economy (UNDP, 2010). This is the

case in spite of major successful artists such as Machel Montano, Kes the Band, and others. The

primary challenges are the small size and the seasonal nature of the popular music, linked as it is to

the Carnival cycle. The seasonality of the music gives creators and performers a very small time

frame in which to sell their products because consumer interest wanes significantly once the festivals

are over. The small market size has created an ongoing search for external markets in North America

and Europe. However, not much of the local music has universal appeal beyond diaspora

communities in North America and Europe, compared to reggae music which is globally entrenched.

The greatest income stream is from live performances because of the music’s (soca and

calypso) strong linkage to the festival economy, where a high premium is placed on live

performances. The overseas carnival circuit within the Caribbean diaspora provides the most

significant market for Trinidadian entertainers touring during the year, affording them the opportunity

to earn foreign exchange and gain much-needed exposure.

Jamaica

Studies have confirmed that the copyright industries, which include all of the sectors under the

entertainment umbrella, contribute approximately 5.1 percent of Jamaica’s gross domestic product

(GDP) per year and account for 3 percent of total employment in Jamaica. In 2004, an estimate of

6,000-12,000 persons was directly employed in the music industry alone. Recent estimates place that

number closer to 15,000 persons, with the industry generating in excess of USD 52.5 million in

revenue (James, 2007).

The Jamaican music industry has considerable depth and breadth and has evolved from

mento, ska, and rocksteady to reggae, dub, dancehall, and other later genres that now appeal to a

mainly young audience all over the world. The reggae element seems to have the most widespread

and lasting appeal, and Jamaican artists regularly perform in annual music festivals in Europe and in

commercial concerts in Japan. There are uniquely Jamaican music labels, a few of which are quite

famous, and several recording studios in Jamaica. Also, some Jamaican artists (such as Jimmy Cliff,

Third World, and Sean Paul) have attained an international reputation and wide appeal, and they

perform with mainstream North American musical stars who are backed by powerful recording

labels. Jamaican music has influenced hip hop and R&B and is, in turn, influenced by them. But there

are numerous other lesser-known artists and new ones that emerge each year who face the challenges

18

of appealing to audiences beyond Jamaica in order to become financially successful. The creativity

and innovation in the local music sector are perhaps due to mainly Jamaican cultural factors. The

outward reach and wider audience demand seem to come as a secondary dividend.

While employment levels are not as high in the audio-visual or film sector (between 1,500 to

2,500 persons are employed annually on a part-time basis), the industry generates revenue of USD

14.3 million annually. But there has also been an increase in the number of projects undertaken in

film and music, with Jamaica’s Trade and Investment Promotion Agency JAMPRO indicating an

increase from 82 in 2001, to 121 in 2005 in its Film and Music Division. The number of plays and

drama productions staged also increased from 24 in 2002 to 42 in 2005. Location filming brought in

over USD 14 million in earnings in 2003 (Roache, 2010).

John McMillan, in a case study entitled Trench Town Rock: The Creation of Jamaica’s Music

Industry, published by Stanford’s Graduate School of Business in June 2005, noted that worldwide

sales of reggae recordings in the late 1990s were an estimated USD 1.2 billion per year, with

approximately 25 percent or USD 300 million flowing to Jamaican musicians, producers, and

songwriters. The earnings by Jamaicans from live performances and sales of ancillary products were

approximately an additional USD 50 million.

Key Challenges Facing the Music Industry

The rapid technological changes in recent years, which have totally transformed the global music

industry, also have major implications for CARICOM creators and music producers. It is no longer

possible to make profits from selling shrink-wrapped CDs since music downloads are the main means

used by young people to consume music. But most musicians in the Caribbean do not have online

platforms for selling their music and must, therefore, rely on American or foreign entities for music

distribution. This shortcoming must be addressed. In fact, the technological changes in recent years

have been making it very difficult for independent artists/musicians or creative people in general to

make money because of the ease of copying and the culture of cheap music downloads among young

consumers.

As an industry report recently pointed out, the following trends have totally disrupted and

changed the music business:

19

The popularity and reach of networks and sites that can facilitate illegally obtaining

music for free are strong, particularly in the Asia-Pacific region and in Spain within

Europe.

The four monetizable online consumption channels ― legal track downloads, audio-only

streaming, audio-visual streaming, and mobile applications ― are seeing significant

demand from global online consumers.

Legal digital downloads remain prevalent globally and are popular with 17 percent of

global online consumers, and they are showing double-digit growth in Europe.

Audio-only streaming is proving more popular than legal digital downloads, capturing 26

percent of global online customers when accessed via a computer. This figure may

increase as dedicated services become more available. Unfortunately, subscription

models have yet to gain popularity with users, although opportunities may be found to

promote these models by offering extra features.

Music video is the most popular consumption medium, with audio-visual streaming

websites being visited regularly by around half of the global Internet population. Music is

consumed three times as often by audio-visual stream than by digital download.

Possibilities of more explicit monetization may exist for this channel (Nielsen Music,

2011).

Most artists in CARICOM states are not in a position to deal with these trends, and they need

technical assistance to cope with the changes in their industry and adjust their business models. There

are no current initiatives to deal with this issue, although it has been pointed out in various studies.

Part of the problem may be due to the fact that a lot of the music produced in the region is still at the

cottage-industry stage or in the informal sector, and the fragmented nature of the music industry

prevents industry-wide mechanisms to deal with these changes. In addition, platforms for e-

commerce are largely underdeveloped in the Caribbean. Royalties for Caribbean music and art

amounted to about EUR 3.3 million in 2008, according to a report by the International Confederation

of Societies of Authors and Composers.7

7 See CISAC 2009 report at: www.cisac.org/

20

The Film/Audio-Visual Sector

Although the indigenous film/audio-visual sector in the Caribbean is not as commercially successful

or profitable as the music industry with regard to exports, this sector is rapidly developing and is full

of creative and talented persons who need avenues to develop their capabilities. It is also a means for

CARICOM states to promote themselves and their cultures globally in a world that is dominated by

American programming. The film/audio-visual sector needs investment and specialized training for

creators.

Fifteen years ago, the Caribbean film and video industry was still in its infancy. The region

produced a plethora of music videos, corporate documentaries, advertisements, and live television

shows, including news, talk shows, sports, and carnivals and other national cultural festivals.

However, there were very few quality independent documentaries, dramas, or feature films. At the

annual Caribbean Broadcasting Union (CBU) awards competition, the majority of the prizes were

won by Cuban filmmakers, apart from Great Belize Productions, which won prizes for a couple of

short features. Very few of the national productions are seen outside of their countries, apart from the

soap operas Royal Palm Estate from Jamaica and Westwood Park from Trinidad and Tobago. There

are virtually no co-productions within the region or with international partners. However, some local

film professionals, such as production managers, “fixers,” drivers, caterers, and technical assistants,

do get to work on foreign productions being filmed on location in the Caribbean, especially in

Jamaica.

Very significant changes have occurred in recent years in the Caribbean audio-visual sector.

The 2007 Bridgetown Film Festival (Barbados) screened 10 feature films made in the region. Some

of these have had good reviews at international film festivals, but few will be able to manage global

penetration due to inadequate distribution and marketing capabilities and the concentrated nature of

the global film distribution industry, which is tightly controlled and dominated by Hollywood

interests. It is, therefore, not surprising that only a few movies made in the CARICOM region have

ever been released internationally. Some films also need to improve on quality. However, the overall

quality and international appeal of Caribbean audio-visual output can be greatly enhanced with the

proper investment in the relevant technology, training, and other development and marketing

initiatives (Nurse et al., 2007). The economic potential of a viable film industry cannot be overstated

in terms of its overall tourism value in promoting specific countries and/or the CARICOM region.

21

In March 2011, sixteen feature films or documentaries and one animated short film produced

in CARICOM countries were screened at the CaribbeanTales Film Festival in Barbados. An

interesting development that shows the potential commercial prospects for the audio-visual sector

was the establishment of CaribbeanTales, a distribution company for Caribbean film based in

Toronto, which now has a catalogue of 60 films.8

In Jamaica, the local film industry essentially comprises both local and foreign projects. Over

the past three fiscal years, JAMPRO has facilitated the launching of some 209 film projects. The

majority of the projects have fallen within the broadcast television program category and have

accounted for 57 percent of the total.9 Only one international (Hollywood) feature film has been

produced in Jamaica since 2007 (Knight & Day), and, more recently, three local feature films (Better

Mus Come, Dance for Grace, and Rise Up) were produced there. The Jamaican feature film Ghetta

Life was released in 2011. JAMPRO has indicated that Jamaica is consistently shortlisted by film

producers, but it is not selected because, when compared with its competitors, it does not have the

breadth or scope of incentives to attract significant levels of investment.10

Stanbury (2003) reported that the Jamaica Film and Video Producers’ Association (JFVPA)

estimated that there were at least 20 companies actively involved in film and video production and

over 300 individual private contractors who provide services to the sector in Jamaica. Jamaica is

somewhat famous for its appeal for location shooting, and some major Hollywood movies have been

filmed there since the 1950s. Maxine Walters ― an experienced and highly respected local line

producer, who has worked in various capacities on Hollywood projects in Jamaica such as Treasure

Island, Clara’s Heart, and The Mighty Quinn in Portland, as well as Instinct and Legends of the Fall

in other parts of the island ― stated that a film project represents a quick short-term injection of

funds that also creates good temporary jobs.11

JAMPRO is in the process of developing a new film policy. The general aim of the policy

changes is to increase the number of film projects undertaken each year in Jamaica through the

provision of investment vehicles for films. A cost/benefit analysis of the impact of the film industry

on the local economy revealed that the economic contribution of the industry is quite significant.

When the indirect benefits accruing from backward and forward linkages are added to the

8 See: http://caribbeantales-worldwide.com/?page_id=2016. 9 Documentaries (18 percent), television productions (30 percent), and television series (9 percent). 10 Interestingly, during an exploratory mission by Caribbean filmmakers to Madrid in 2008, Spanish audio-visual industry investors indicated that they

expected full tax-free treatment and bilateral tax treaties to avoid double-taxation in order to even consider a location. 11 See: www.jamaicaobserver.com/business/Overseas-film-projects-boost-Port-Antonio-economy_7872782#ixzz1N4phqqqo.

22

calculations, the impact is seen to be even greater. This overall positive outlook will continue even if

there is a lack of government support for the industry, although such support was recommended in a

new proposal drafted by JAMPRO.

JAMPRO also recommended that a film industry tax credit scheme be developed to

incentivize the private sector’s involvement in the industry. The financial contributions of corporate

firms would be used to establish Film Funds, which would support industry development, as well as

film production and promotion. The incentive program can operate through the extension of tax

credits to either a public sector Film Fund or through special provisions for the establishment of

private Film Funds. Corporate entities opting to contribute to Film Funds will receive a 70 percent

credit against taxable income. It is also recommended that the existing discretionary waivers be

entrenched in law, which would make them automatic upon the confirmation that certain eligibility

criteria are met.12

However, the overall aim — similar to that of Ireland — is to focus on the

development of the local industry as the catalyst for growth in the number of foreign feature

filmmakers that elect to film in Jamaica in the medium to long run.13

At the same time, a small sub-set of the audio-visual industry, the animation sector, also

shows tremendous potential for growth in CARICOM, but it needs significant investment. Since

2001, the annual Animae Caribe: Animation and New Media Festival in Trinidad and Tobago has

helped to raise awareness of animation locally and in the region. The festival attracts experts from the

international animation industry from renowned studios such as Disney and Sony Pictures. The

festival has strong corporate sponsorship. Studios in Trinidad and Tobago and some in Jamaica

produce animation primarily for the advertising industry.14

But they are very small entities and do not

yet produce for foreign markets; indeed, very few animation studios in these countries have full-time

animation work. They do other things as well. Most animators specialize in animation for short-form

commercial usage (such as TV commercials and interactive DVD) and architectural animation. The

first set of animators graduated from the Diploma program in animation at the University of Trinidad

and Tobago (UTT) in 2010. There are already close linkages between the animation sector in

Trinidad and Tobago and Toon Boom Animation of Montreal, which is a world leader in the

12 These are recommendations in a proposal developed for JAMPRO. 13 The intent to develop a film industry in CARICOM states seems to be less ambitious that in the Dominican Republic. In this respect, in January 2011,

President Leonel Fernandez of the Dominican Republic visited India to develop a better understanding of the ways in which it developed the skills necessary to create a globally successful movie industry. And, in February 2011, two Dominican companies (Vicini and Indomina) announced that they

had entered into a partnership agreement with Pinewood Studios in the United Kingdom to operate and manage a huge new state-of-the-art film and

television facility in the Dominican Republic, which has the full support of the government and special incentives for the investment. 14 Note that the Trinidad and Tobago Film Company’s 2009 Production Directory lists 16 animators or entities involved in animation.

23

production of 2D animation software and has clients all over the world. The CEO of Toon Boom,

Joan Vogelsang, who has Trinidadian connections, has participated in all the Animae Caribe festivals

in Trinidad and has actively supported the efforts of Full Circle Production’s Camille Selvon-

Abrahams to stimulate an animation industry locally. Ms. Vogelsang also helped start the Diploma in

animation at UTT.

Full Circle Production has managed to produce a pilot for a cartoon series based on the folk

hero, Anansi spider, which needs funding to develop into a full series. It generated significant interest

at the 2010 Toronto Film Festival, and a few broadcasters have indicated that they would be

interested in the series. 2-D animation is the first step in a sophisticated chain of high-value activities

in new media, which continues on the path to 3-D and the video gaming industry that is worth

billions of dollars. The little steps that Trinidad and Tobago (and other CARICOM economies) can

take to get animation on that path will produce dividends later. The sector needs public-private sector

collaboration to jump-start the fledgling indigenous industry and help fit it into an exciting and

innovative global industry in which Canada is a significant player. Canada is renowned for its 2-D

and 3-D animation and imaging software developers for interactive digital media, such as Flood

Software, specializing in the animation of fluids, and XYZ RGB, which performs 3-D scanning of

objects, including faces and animals, for film and games such as King Kong, Lord of the Rings, The

Matrix, and Electronic Arts’ “Need for Speed.”

Governments in CARICOM should think strategically about the significant local initiatives to

develop animation and support them in increasing the connections and commercial linkages with

Canada, the UK, and other key markets. While animation is taught at the Edna Manley College in

Jamaica and at UTT, this instruction is inadequate in terms of training facilities for the development

of an export-oriented animation industry. At the same time, there is a need to research the value

chains in the global animation industry and promote linkages with them. In particular, national

investment promotion agencies should target the animation sector in their outreach and try to attract

investment in this area by international firms.

V. Deficiencies in the Regulatory/Policy Framework

Support for Creative Industries Internationally

It is a well-known fact that developed countries invest heavily in their cultural industries. The

European Commission has several programs for all sectors of the creative industries in the European

24

Union, and individual Member States such as France, the UK, and Germany provide very substantial

grants and facilities to help these industries develop talent and add value to their economies.

Furthermore, there is a clear perception of the creative or cultural industries as economic sectors, and

there are policies in place that link them to industrial strategies. For instance, Finland has made

creative industries a priority of the Ministry of Employment and Economy. In the Netherlands, the

Ministry of Culture works closely with the Ministry of Economic Affairs in relation to policy

developments. Similarly, in Germany, the Ministry for Economic Affairs and Technology is

responsible for implementing the national cultural industries strategy (KEA, 2010). While these

European countries do export some cultural goods and services, it is not a requirement for the

funding. The EC’s MEDIA 2007 program for the audio-visual sector has a budget of EUR 755

million for 2007-2013.

In the UK, at least 2 million people have jobs related to culture, and the firm KPMG reported

to the UK government that employment in the creative sector would grow by 46 percent in the 20

years up to 2015. Tessa Jowell, a former UK Culture Secretary, estimates that 20 percent of UK’s

GNP can now be attributed to the creative industries, with music alone worth GBP 5bn. The UK film

industry employs 47,000 people, the computer games industry 22,000, and the design industry 70,000

(Goris, 2008).

In Canada, the cultural industries accounted for about 1.1 million jobs, and the real value-

added output amounted to CAD 46 billion in 2007.15

Sound recording, book publishing, magazine

publishing, broadcasting, film, television, and new media receive funding from a number of sources.

Besides the sales of products and services, which are common to all of these industries, revenue

sources particular to a given industry may include licensing and distribution, advertising, the sale of

rights, investments required of cable companies and broadcasters, government subsidies and loans,

and indirect government support through tax-based credit or investment measures. Arts, heritage, and

cultural industry organizations alike receive direct government funding, usually in the form of grants

or contributions (and sometimes, in the case of cultural industries, loans or loan guarantees). The

Conference Board of Canada estimated that spending on culture in 2007, for all levels of government

in the country (federal, provincial, and local) amounted to CAD 7.9 billion. The total value of real

culture exports was just under CAD 5 billion in 2007. But, beyond direct funding, these sectors are

influenced differently by government action and policy. For arts and heritage institutions, tax

15 See Valuing Culture: Measuring and Understanding Canada’s Creative Economy. Conference Board of Canada, Ottawa, 2008.

25

measures affecting charitable donations are extremely important. The cultural industries, operating in

an industrial or business environment, often benefit from tax investment incentives.

More recently, China has been investing heavily in cultural industries at the federal and

provincial levels. The newly released 12th Five-Year Plan of the Communist Party of China (CPC)

made it clear that the cultural industries should be developed into a pillar of the economy in the next

five years, meaning that the cultural sector should comprise at least 5 percent of the total GDP by

2015, whereas it currently accounts for less than 2.5 percent. In order to address the financing

difficulty faced by China’s cultural sector, in 2010, nine government ministries jointly issued

guidance on financial support for the rejuvenation and prosperity of the cultural industries (Zhenyu,

2011).

Brazil is also investing in the development of its creative industries, and successive

governments are continuing this approach. The Brazilian Development Bank (BNDES) seeks to

encourage the development of creative companies and agents, aimed at expanding the cultural goods

and services market and making it more efficient, with economic sustainability and social gains. To

achieve this goal, it offers “a diversified set of financial support tools to the cultural industry,

including application of non-reimbursable funds in artistic/cultural collections and projects for the

preservation of Brazilian historical heritage.”16

In addition to investing in projects and companies in

the cultural sector, the BNDES also regularly offers free exhibits and presentations, besides

sponsoring cultural events across the country.

Inadequate Support for the Entertainment Sector in CARICOM

A conducive and supportive regulatory and legal environment is a sine qua non for the growth and

development of thriving and competitive cultural industries. Indeed, countries with strong cultural

sectors and those that succeed in marketing globally competitive cultural goods and services have had

to carve out sufficient policy space and set up the appropriate infrastructure to enable local creativity

to flourish, allow creative persons and enterprises to develop, and ensure that their rights and

obligations are respected and legally protected. The experience of countries that have successfully

promoted their domestic cultural industries (Ireland and Canada) shows that this sector can contribute

to skill-intensive, high-value-added activities that generate rich upstream and downstream linkages

with ancillary sectors throughout the economy, including ICT and design capacities.

16 See BNDES website: http://www.bndes.gov.br

26

If one considers all of the initiatives (studies, workshops, and consultations) that have been

undertaken in CARICOM countries in the past eight years regarding cultural or creative industries, it

would suggest that national governments are really interested in developing this sector. In Barbados,

the National Task Force on Cultural Industries was one of the first task forces of its kind to be

established in the Caribbean in 2002, comprising nine ministers and a number of representatives from

different sectors and institutions and focusing on culture and development. As a result, Barbados’

Creative Economy: A Cultural Industries Development Strategy was prepared in 2004. Since then,

increasing attention has been devoted to the potential of the creative economy as a development

strategy for Barbados. However, not much has changed in the sector. The strategy and a proposed bill

to grant incentives to the sector have stagnated for several years, and while a third government is in

place, an incentive regime has not yet been established.

The situation in the rest of CARICOM is very much the same ― various consultations and

pronouncements at the political level, but little support to the sector or removal of government

measures that constrain the sector’s development. Trinidad and Tobago has had strategies for the

Entertainment Sector (2006) and the Film Industry (2005). They have resulted in some funding for

the Entertainment Company (TTent) and the Trinidad and Tobago Film Company, but their budgets

are insufficient.17

The Government of Jamaica released a cultural policy document in 2003 with a somewhat

ambitious title, “The National Cultural Policy of Jamaica: Towards Jamaica the Cultural Superstate”

which contained very relevant and good intentions, including the following:

Give direction to activities geared toward the development of cultural industries through

the provision of incentives for private-sector involvement in this area.

Articulate clear and coherent actions between this industrial sector and other

industries/sectors in order to ensure that strategies, instruments, and mechanisms already

in place or being negotiated in those other sectors may be of benefit to cultural industries.

17 The Trinidad and Tobago Film Company recently received proposals for 250 local projects but has a budget of only USD 1 million.

27

Provide financial support, directly or indirectly, to individuals, artists, producers, and

institutions involved in the promotion and development of cultural expression, in

particular those related to cultural industry development.18

However, few of the prescriptions in the policy have been implemented, the reasons for which

are unclear. Commentators cite a lack of resources (human and financial), but real political support is

also a key requirement for the sector.

Several years ago, JAMPRO set up a Creative Industries Unit as one of its key clusters for

development. Jamaica also published a National Entertainment Export Strategy in 2009 and is

currently working on a new Film Policy. But these processes take a long time and struggle to produce

meaningful policy changes or actions of visible benefit to the sector. The relevant departments are

also under-resourced in terms of personnel and financing.

Since 2008, at the regional level, the CARICOM Secretariat has been engaged in discussions

through the Regional Culture Committee (RCC) on the development of a Regional Policy Framework

on Cultural Industries, but this has not yet materialized. A Regional Cultural Policy of the Caribbean

Community dates back to 1996, but the term “cultural industries” only appears once in it. It identified

the following as one of the short-/medium-term actions required: “That Member States remove

customs duties and non-tariff barriers which affect the free movement of art, artists and their

materials and equipment within the Region.”19

As a result of the lack of tangible action across the region, cultural or creative industry

practitioners are largely cynical about government support of the sector. Nevertheless, most of the

donor activity, if not all, has been focused on government agencies or intermediary organizations and

not on the cultural practitioners or entertainers themselves. The most recent regional (CARICOM-

wide) initiative regarding the creative sector, held in St. Lucia at the end of March 2011, involved

almost all of the multilateral agencies ― ITC, WIPO, WTO, UNCTAD, UNESCO, and ECLAC ―

18 National Cultural Policy, p. 34. The policy was approved by the Jamaican Cabinet in December 2003. 19 There have been some developments in relation to the CARICOM Regional Cultural Policy and the draft Regional Strategy, including the

development of a draft Action Plan for the Cultural Industries in CARICOM. A number of difficulties have delayed the adoption of the draft such as: coordinating inputs of Member States, including the time taken to carry out in-country consultation on the drafts in all Member States; limited resources

of Member States to participate in face to face meetings; and the need for consideration of the documents by other organs of the Community than the

Council on Human and Social Development, which is overseeing the development of these document (e.g. the Council on Human and Social Development). The COHSOD endorsed in the 1st quarter 2012 several recommendations that would begin to address some of the major problems

highlighted in this note such as: a harmonised regional exemptions regime to reduce import duties and charges on inputs (but this will require

endorsement by trade officials), a harmonised incentive regime for the sector, legislation on cultural industry development, creation of a fund to support

the sector, creation of national and regional registries of artists and cultural workers.

28

but it was mainly focused on documenting the creative industries and gathering statistics.20

Policymakers and officials in the CARICOM region still seek the economic value of the cultural

industries quantified before they feel comfortable taking any serious action to promote the sector.

However due to the diverse and small-scale nature of most of the creative practitioners, this is a

challenge to realize.

The Office for Trade Negotiations held major regional consultations with the creative

industries21

as a group and then with the audio-visual sector (2009), but the recommendations

resulting from these consultations have not been adopted by any government. Nevertheless, the

consultations informed the negotiating positions of the region, and, as a result, the CARIFORUM-EC

Economic Partnership Agreement (EPA) has substantial provisions regarding culture and

entertainment. However, the ability to take advantage of those provisions requires concerted and

well-conceived public-private sector collaboration, which is not currently on the horizon. In the

meantime, since the EPA was signed, the EC has completed a trade agreement with South Korea,

which also has a protocol on Cultural Cooperation modeled on the template in the EPA.

Apart from the film sector in Barbados, Jamaica, and Trinidad, there are few incentives to

develop the cultural and entertainment sectors. On the other hand, direct grants to cultural

practitioners are very limited in the Caribbean.22

Furthermore, the regulatory framework for cultural

industries or the entertainment sector is under-developed in all of the CARICOM states. There is

almost no regulation governing the music industry and no standards in any branch of the professional

performing arts sector. The local film industry is not regulated but has grown over the past five years

as cable television and the Internet have become more popular and accessible.

In order to stimulate further growth and development of cultural industries, it is important that

incentives and support programs are predictable, transparent, and readily accessible to creative

persons and firms in the region. They should be fairly simple in terms of implementation. It is also

sensible to have similar programs at the CARICOM-wide level to foster regional collaboration by

creative persons. This will allow cross-fertilization, increase the level of innovation, and lead to scale

20 Training Seminar entitled, “Assessing the Economic Contribution and Performance of Creative Industries to National Economies,” March 29-30, 2011. 21 A major cultural industries forum in 2004 and a second one in 2006 on “Promoting Creative Industries: A Trade and Investment Strategy for the

Caribbean” were organized with the support of the EC’s Proinvest Trinnex Project. They were used to develop a research agenda for the sector and then to consider the findings and recommendations of a major study. A follow-up project for the audio-visual sector was designed by the CRNM and funded

by the EC’s BizClim program. It reviewed the situation in the region and best practices for the development of the audio-visual sector in other countries.

In 2010-2011, this was followed by an EC-funded TradeCom project to develop a model for a co-production treaty for the audio-visual sector in the Caribbean that was coordinated by the CARICOM Office of Trade Negotiations (OTN). 22 In Trinidad and Tobago, there is some funding available from the Entertainment Company for artists and musicians to perform overseas. There is also

a tax incentive for companies that purchase local works of art or support performing artists and for audio-visual productions that reflect local

entertainment or local culture. But these seem to be hardly known, and little use is made of them.

29

economies. At the same time, it is important for governments to remove the real barriers or

disincentives to investment and trade in cultural industries at all levels ― corporate and personal.

Furthermore, Trade, Culture Industry, and Finance ministries should collaborate in devising regimes

to stimulate dynamism in the creative sectors so that more culture practitioners can become

successful businesses.

Cultural support to creators is of course essential to sustain diversity and promote creativity

throughout CARICOM. In fact, cultural diversity is an important backbone of an innovative and

ultimately competitive society. On the other hand, the tendency of the creative sector to be linked to

cultural rather than industrial policies has led to a situation where there are few innovation policies

that cater to the business requirements of creative companies. In turn, this exclusion of the creative

sector from traditional industrial support might have contributed to the fact that innovation policy

throughout CARICOM is largely non-existent.

VI. Key Policy Challenges Facing the Entertainment Sector

Tariffs and Taxes on Inputs to Cultural Industries

The greatest disincentive to investment in the entertainment sector in CARICOM states is the

imposition of high tariffs, taxes, and other duties and charges (ODCs) on almost all of the inputs to

their cultural industries. Based most likely on antiquated thinking and the belief that cultural items

should be considered luxury goods, some of these inputs attract the highest charges in the Common

External Tariff (CET), particularly in the smaller OECS economies. Table 3 provides a brief snapshot

of this problem, with a sampling of products that are considered inputs to creative activities and the

total duties and other duties and charges levied on them.

30

Table 3. Total Duties, Taxes, and ODCs Imposed on Selected Inputs to

Cultural Industries in CARICOM States23

Product Category (HS code) CET

%

Antigua

%

Barbados

%

Grenada

%

Jamaica

%

St Lucia

%

T&T

%

5907.00: Textile fabrics coated or

covered; painted canvas used as

theatrical scenery; studio back-

cloths, etc.

- 30 21 35 18.8 55 20

8518.40: Audio frequency electric

amplifiers

- 55 61 65 48.8 51.5 45

8525.80: TV cameras, digital

cameras, and video camera

recorders

20 45 36 35 38.8 61.5 35

9203.00: Keyboard pipe organs,

harmoniums, etc.

10 35 26 40 18.8 26.5 25

9206.00: Percussion musical

instruments

20 45 36 50 38.8 46.5 35

9603.30: Artists’ brushes 20 45 76 50 38.8 41.5 35

Source: Author’s calculations based on data collected from national customs departments in 2009.

Total charges on camera equipment into St. Lucia amount to 61.5 percent of the value of the

equipment, the highest percentage, and the charges on this equipment in Trinidad and Tobago and

Grenada amount to 35 percent, the lowest percentage. For example, if a film or video producer

decides to buy a high-quality digital video camera, which costs about USD 100,000, he/she will have

to pay USD 61,500 to the St. Lucian government, amounting to what are really punitive and perverse

taxes. It is, therefore, not surprising that there are few high-quality cameras on the island.24

While the

common external tariff may be only 20 percent, the other taxes and charges make it prohibitively

expensive to import much of the equipment needed for sophisticated activities such as music editing,

video production, and editing or any kind of post-production functions. Even paint brushes attract

charges of 76 percent in Barbados. The high charges levied at the border are clearly a disincentive to

all investment. In some countries, there are informal provisions for the waiver or reduction of a duty,

23 Note that the planned introduction of valued added tax (VAT) regimes in some CARICOM states may affect the overall level of taxation on various

products by replacing the general consumption tax. 24 People needing to make music videos, for instance, have to go abroad.

31

but they are often based on political or other connections, rather than a predictable and transparent

regime. However, in Jamaica, under the incentive for the audio-visual sector, if a firm is recognized

as a motion picture producer, it is granted a special exemption called the Motion Picture Recognition

status. This allows the firm to be granted duty- and tax-free treatment for production equipment as

well as machinery and materials for the building of studios or for use in motion picture production. 25

The import charges associated with the inputs to almost all creative activities constitute a

perverse policy measure given that CARICOM governments claim they want to promote and develop

the creative industries. Furthermore, there are no producers of music or electronic equipment in

CARICOM, so the protectionist or infant industry argument is unconvincing. It would appear that the

high duties and taxes are revenue-seeking measures imposed by CARICOM governments. In order to

stimulate the development of the creative sector, policymakers must seriously address this issue. The

punitive charges are a major disincentive and act as a direct constraint on investment by the

predominantly small firms and individuals in the creative sector. Though the issue was raised at a

meeting of Trade ministers (COTED) in November 2011, a decision was made to hold more

consultations with other government stakeholders and the industry at the national level.

The Lack of Financing for Investment in the Entertainment Sector

There are numerous challenges that impact the creative sector in CARICOM states. Apart from the

technological changes and policy gaps discussed above, the deficient level of investment in

infrastructure and training urgently needs to be addressed. A major constraint is the lack of financing

for creative projects. The banking system is averse to lending to the sector, partly because has

difficulty assessing risk in these new types of businesses, and persistent conservative ideas of

business activity are not responsive to new ideas. (This is largely a focus with bricks and mortar

concepts of business, or physical plants, and there appears to be little interest in new business models

in service activities that do not involve physical assets.) Furthermore, none of the lending institutions

in CARICOM have begun to value intellectual property assets for collateral purposes. For instance,

Eddy Grant, a major music icon and veteran entertainment industry businessman in the region, who

has a first-class recording studio in Barbados, is unable to raise financing in any regional bank.

However, his company, ICE Records, now has a catalogue of almost 10,000 song titles. In fact,

entertainment loans in Jamaica still comprise only 0.2 percent of total loans despite the fact that the

25 Jamaica also has a facility for “tools of the trade” for artists, under which duties are waived or reimbursed, but there is a lack of clarity, transparency,

or predictability in the regime.

32

core copyright industry contributes 1.7 percent of the GDP. The core and partial copyright industries

collectively contribute 4.8 percent to the GDP.26

There are examples of financial institutions (such as the IFCIC27

in France or the Audiovisual

SGR28

in Spain) and private banks (such as Ingenious29

in the UK) that specialize in the creative

sector. But such institutions are unlikely to develop in the tiny markets of CARICOM, and certainly

not with the current attitudes toward the entertainment sector in financial institutions and little

support by Caribbean governments to stimulate the sector. It may, therefore, be worthwhile to study

the examples of these institutions in France, Spain, and the UK, mentioned above, to see how they

operate and, in particular, how they value intellectual property assets and contracts held by creative

persons for lending purposes. They are not in a position to provide technical assistance to the

Caribbean, but it may be feasible to discuss with them the key elements of their operation with

respect to their criteria for selecting projects for financing and advice that they provide to creative

entrepreneurs.

Freer Movement of Artists but not of their Equipment

One means of improving the quality of, and stimulating innovation in, cultural products and services

from the region (in order to increase exports) is to facilitate and promote greater intra-CARICOM

collaboration in cultural industries. However, in spite of the CARICOM Single Market,

administrative challenges across the region result in most artists (especially music and performing

artists) reporting that it is much easier to collaborate on joint creative projects with foreign artists

rather than regional ones.

While the Single Market is legally in place, artists and musicians report that it is not easy to

move from one Member State to another. Some have indicated that destination countries do not

automatically accept documentation from their countries of origin. A further issue is the difficulties

associated with customs procedures for allowing the entry of equipment that artists need to conduct

their work. This applies whether the equipment involves paintings, electronic equipment, or props.

Bond requirements can be prohibitive for small bands or groups. However, the customs procedure,

26 See: www.jamaicaobserver.com/news/ent-loans-grow-14#ixzz1Mt1cK1lr. 27 Institut pour le Financement du Cinéma et des Industries Culturelles (IFCIC) is a financial institution with a mandate from the Ministry of Culture and

the Ministry of the Economy and Finance to contribute to the development in France of cultural industries by facilitating these firms’ access to bank financing. As a neutral and autonomous entity, IFCIC is 49 percent owned by the State, OSEO Group, and La Caisse des Dépôts, and the rest by a

private shareholder committee, including almost all French banks (www.ifcic.fr). 28 See: www.audiovisualsgr.com . 29 See: www.ingeniousmedia.co.uk .

33

itself, is far removed from trade facilitation. For instance, if a music band from Trinidad goes to

perform in Jamaica, it will send a detailed list of its equipment to the Customs department in Jamaica

in advance (usually through the promoter’s customs broker). Then, on departing from Trinidad, the

local customs authority will verify all of the equipment and serial numbers, etc., before stamping the

official export/exit documents. However, when the equipment arrives in Jamaica, local customs

authorities also check every piece of equipment again and reconcile serial numbers. National customs

officials apparently do not accept documentation from the customs authority in the country of origin.

When the equipment leaves Jamaica (for re-export to Trinidad), all serial numbers are reconciled

once again and a customs official escorts the equipment throughout the process. When the same

equipment returns to Trinidad, the same scrutiny is applied. The administrative cost of this process

must certainly be high. The need to check and double-check and the refusal to accept the

documentation from the customs authority on the sending end is a major hurdle and sometimes

results in equipment not arriving on time.

Most artists and entertainers indicate that it is difficult to move around with their equipment.

In the case of the visual arts, the situation is even more challenging. Since paintings and photographs

are considered luxury items, onerous bond requirements are applied by customs authorities, and, as a

result, very little movement of visual art now takes place intra-CARICOM. But this problem of

customs difficulties applies to all areas of the cultural industries. In one instance, a non-commercial

documentary video program on master tapes that was sent by a videographer from Trinidad to St.

Lucia was charged duty on its return to Trinidad (the origin of the video). Furthermore, when

musicians send their videos or CDs (standard promotional material) to TV and radio stations

throughout the region, this material is subject to duties and charges that are sometimes prohibitive in

almost all Member States. Artists contend that customs officials often arbitrarily determine the value

of the material or use standardized charges and tariffs that are above the actual manufacturing cost or

value of the material.

The anecdotal examples given above reflect real impediments to the seamless movement of

creative persons in the CARICOM region and, hence, collaboration among them. This needs to be

resolved to stimulate greater intra-CARICOM creative projects and events as a stepping stone to

targeting and appealing to larger markets. It is hoped that the CSME process and the progress made

regarding the movement of artists can be taken further to help cultural practitioners work seamlessly

34

at the pan-Caribbean level with all of their tools of the trade. After all, artists were included in the

first category of persons that were granted free movement by CARICOM governments in the Single

Market.

VII. Market Access for CARICOM Entertainers in Europe under the EPA

The European Union is a vast and varied market for entertainment services of all kinds. The

CARIFORUM countries took advantage of the EPA negotiations to formalize market access in the

EU and to provide for increasing cultural cooperation between the two regions.

The cultural sector and entertainment services, in particular, are addressed through two

instruments in the EPA. These instruments are:

(i) Market access commitments by 26 European states for entertainment services from

CARIFORUM states that are governed by the rules of the Services and Investment

chapter and the general provisions of the EPA

(ii) A special Protocol on Cultural Cooperation

Market Access Provisions

In the case of the EPA’s market access provisions, it is important to note that, in addition to allowing

Caribbean firms to invest in entertainment activities in Europe30

for the first time, the EC and its

Member States granted legally binding and significant market access for the supply of entertainment

services through the temporary entry of natural persons for up to six months. This is categorized as

Contractual Service Suppliers (CSS) under the EPA for the following activities:

CPC 9619 Entertainment Services (other than audio-visual)

96191 Theatrical producer, singer group, band and orchestra entertainment services

96192 Services provided by authors, composers, sculptors, entertainers, and other individual

artists

96193 Ancillary theatrical services n.e.c.

96194 Circus, amusement park, and similar attraction services

96195 Ballroom, discotheque, and dance instructor services

96199 Other entertainment services n.e.c.

30 All of the EU, except nine of the new members mainly from Eastern Europe.

35

Under the EPA chapter on Services, Contractual Service Suppliers are defined as follows:

Natural persons (individuals) of the EC Party or of the Signatory CARIFORUM States employed by

a juridical person (company or firm) of that EC Party or Signatory CARIFORUM State which has no

commercial presence in the territory of the other Party and which has concluded a bona fide contract

to supply services with a final consumer in the latter Party requiring the presence on a temporary

basis of its employees in that Party in order to fulfill the contract to provide services.

All EU Member States except Belgium undertook commitments in the entertainment sector

for CSS. It is hoped that eventually Belgium will do so as well. The commitments of the EU-15 went

into effect once the EPA was provisionally applied in 2008, but those of the newer states (EU-10)31

went into effect at the end of 2011, and those of Bulgaria and Romania are scheduled to take effect in

2013.

Market access granted to Caribbean entertainers, artists, and other cultural practitioners may

be subject to qualification requirements32

and is subject to economic needs tests (ENTs). A full

commitment to the opening of the market by the EU without quotas is conditioned on fulfillment of

the ENTs. But the ENTs are not new; they have been in effect in several European countries for a

long time, but the paperwork was handled by promoters on the European side, so Caribbean

performers may not have been aware of the process.33

The EPA grants legally binding access to

practically all of the EU and to significant markets such as France where the culture-trade interface is

a contentious and very sensitive issue. Furthermore, this level of market access in the entertainment

sector provided by so many EU states has never been granted before to any other country or regional

grouping.

This commitment offers those in the creative sector the same basis for entry into EU countries

as Caribbean business professionals. Caribbean artists, musicians, and other cultural practitioners and

their crews who are registered as businesses will also be able to send their members or employees to

Europe, and they will benefit from the same conditions as traditional professionals do while

supplying entertainment services under the category of CSS. Artists or members of bands who are

31 Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovak Republic, and Slovenia.

32 Note that the entertainment sector covers even highly skilled categories that require many years of training such as classical concert musicians, composers, conductors, etc., so, in some instances, qualifications are important. However, in regular, popular, live entertainment activities, qualifications

are not an issue. 33 For instance, in the case of the United Kingdom, see Work Permits Sports and Entertainment: Guidance for Employers, 19 November 2007 – 30

March 2008. (www.bia.homeoffice.gov.uk/workingintheuk/ workpermits/workpermitarrangements/sportsandentertainments/)

36

self-employed, are the only employee of a company that they own or do not own, and receive a salary

from the band, for example, are to be considered CSS and are therefore covered by EC commitments

on Entertainment in the EPA. The commitments also cover other cultural practitioners such as visual

artists, sculptors, dancers, and carnival presenters.

The potential for carnival band leaders in the Caribbean to do business in Europe is

tremendous considering that 17 European countries have annual carnivals of some kind, albeit

different from the Caribbean type. The skills in design, construction of costumes, and all other areas

of pageantry that have been developed over the years in Trinidad and Tobago and, to a lesser extent

in the rest of the region, are exportable and can be applied to new markets. In fact, there are annual

street carnivals of some kind in 38 countries apart from Brazil and the Caribbean.

The Protocol on Cultural Cooperation

The market access granted by the EU to Caribbean entertainers is complemented by a historic and

innovative Protocol that provides for bilateral cooperation in a variety of cultural activities. While the

market liberalization arrangements, detailed in the Services chapter of the EPA, provide access for

cultural practitioners who want to sell their services in Europe, the Protocol on Cultural Cooperation

facilitates those who wish to enter the EU for other cultural activities, including collaborating with

creative persons in the cultural market. The Protocol provides a framework for the temporary

movement and training of artists and other cultural practitioners in the performing and visual arts, and

contains special provisions regarding the audio-visual sector.34

The principal objectives of the Protocol include:

Helping to integrate the cultural dimension at all levels of development cooperation

Promoting local and regional cultural content

Facilitating exchanges of cultural activities, goods, and services

Redressing the imbalances, which exist in trade and other exchanges between CARIFORUM

states and the EU

The Protocol’s starting point is the UNESCO Convention on the Protection and Promotion of

the Diversity of Cultural Expressions, which was adopted in Paris on October 20, 2005, and provides

34 Article 5 of Protocol III to the CARIFORUM-EC Economic Partnership Agreement.

37

for developed countries, such as those in the EU, to extend preferential treatment to developing

countries.

The EPA’s Protocol on Cultural Cooperation outlines a comprehensive framework for

cooperation between cultural professionals from CARIFORUM and the EU. It also addresses

mechanisms for various cultural exchanges with, and technical support to, CARIFORUM Member

States. The principal issues covered in the Protocol include:

Cultural Exchanges and Training

The Protocol facilitates access to the EU by Caribbean artists and other cultural practitioners (who are

not involved in commercial activities in the EU) in order that they might be able to collaborate on

projects with European counterparts; receive training; learn new techniques; and engage in creative

production, including joint audio-visual productions with EU partners. Caribbean cultural

practitioners, seeking to benefit from this cooperation, will be allowed to remain in any EU country

for up to 90 days in any 12-month period. Previous EU trade agreements have included very limited

or no provisions for cooperation on cultural projects between Caribbean and EU cultural

professionals.

The scope of cultural cooperation under the Protocol was deliberately structured to cover the

broadest practical range of creative expression, including activities particularly relevant to the

Caribbean, such as carnivals and mas costume design. The Protocol aims to facilitate training to

improve the skills of regional artists and to increase contacts between these artists and other EU

cultural professionals and practitioners such as:

Theatrical producers, singing groups, and band and orchestra members

Authors, poets, composers, sculptors, entertainers, and other individual artists

Artists and other cultural professionals and practitioners participating in the direct supply of

circus, amusement park, and similar services, as well as in festivals and carnivals

Artists and other cultural professionals and practitioners participating in the direct supply of

ballroom and discotheque services, and dance instructors

Mas35

performers and designers

This Protocol mechanism will be particularly useful for the less well-established artists,

entertainers, and other cultural practitioners who are not operating commercially in the EU. They can

now enter EU states under the cooperation provision for training, market exposure, and collaboration

35 Refers to Carnival.

38

with European colleagues. It is envisaged that, over time, the emerging cultural practitioners will

develop useful market knowledge and valuable contacts in the EU that can eventually lead to

commercial contracts.

Cooperation in the Audio-Visual Sector

While the historical tradition and EU-wide policies do not allow market access commitments in the

audio-visual sector in any trade agreement, the EPA Protocol on Cultural Cooperation provides

possibilities for collaboration with European producers in order to facilitate access into the EU for

Caribbean audio-visual material through special mechanisms (see Articles 5 and 6 of the Protocol). In

particular, co-produced audio-visual products and services involving European and Caribbean

creative teams will qualify as domestic productions and meet the audio-visual content rules in all EU

states and in the Caribbean.

In the audio-visual sector, the Protocol also seeks to stimulate the negotiation and

implementation of co-production agreements between individual EU states and CARIFORUM states.

These co-production agreements are necessary in order to make it easier for CARIFORUM audio-

visual producers to access EC funding for creative projects. Caribbean and European governments

have also agreed to allow temporary importation of equipment without duties for shooting films and

television programs. However, since the EPA was signed, Caribbean governments have not

negotiated co-production treaties with any EU state, and no regional initiative has been undertaken in

this regard. There is an old co-production treaty between Jamaica and the United Kingdom that was

never really implemented, but it only deals with films and is not directly relevant to multimedia or

new media. In 2011, the CARICOM Office of Trade Negotiations released a commissioned study

(Smith, 2011) and facilitated regional discussions on a model co-production treaty for the audio-

visual sector. It is now time for either national governments or a regional entity in the Caribbean to

approach EU states regarding the need for co-production treaties.

Development Cooperation

The Protocol also provides for technical assistance through different vehicles, inter alia, training,

exchange of information, sharing of expertise and experiences, and advice on policies and legislation

as well as on the usage and transfer of technologies. (Note that there is no specific financial allocation

39

to implement the Protocol.) This technical support is expected to include cooperation between private

companies and between non-governmental organizations, as well as public-private partnerships.

Some of the areas identified for development assistance include:

a) Training and facilitating professional exchanges between performing artists, including

participation in auditions and cultural networks;

b) Stimulating joint productions in the performing arts between producers from the Caribbean

and those in the EU;

c) Facilitating the development of international theatre technology standards;

d) Granting preferential treatment to audio-visual producers, including through the facilitation

of participation in festivals, seminars, and other similar initiatives;

e) Facilitating the participation of CARIFORUM nationals in audio-visual co-productions,

which can qualify for national treatment in the EU;

f) Professional exchanges and training for librarians, writers, translators, and book publishers

g) Facilitating co-publishing and translations;

h) Facilitating exchanges of expertise and best practices regarding the protection of sites and

historic monuments.

CARIFORUM artists or creative persons may also be able to benefit from EC funding to

participate in some of the numerous cultural events and festivals that are held in the EU every year

and cover all areas of creative expression. However there is a need for marketing campaigns in

Europe to promote the Caribbean as a place for creative collaboration.

VIII. Proposals for Actions for the Entertainment Sector

An effective technical assistance strategy or support program for the entertainment sector in

CARICOM must be multi-pronged. It must address both systemic and structural needs and challenges

facing the industry as well as marketing initiatives in the target markets in which CARICOM creators

or entertainers want to sell their products and services. To be precise, related projects should cover

the following areas:

Infrastructure

40

Investment

Product Supply

Domestic Market Development

International Market Development

Professional Development and Training

Regulation and Policy

New Technology and Multimedia

It is crucial for Caribbean governments to take a more active role in promoting the sector.

Though much has been said with regard to the virtues of culture and cultural industries, more must be

done to treat it as a viable economic sector. Many cultural industry professionals will argue that much

of the success of the music industry in the CARICOM region has occurred despite the lack of

government support. In fact, it is clear that it is Jamaican music that has given Jamaica global

recognition and status, and not government support. The discussion above regarding the counter-

productive policies regarding tariffs and taxes on inputs to the sector, which act as a major

disincentive to investment in the sector, is a clear case in point.

While it is apparent that what international technical assistance can do for the entertainment

sector in CARICOM is limited, this paper will present a program of activities to support the

entertainment sector that may be undertaken by national Governments or by one or several

development partners. The activities outlined below reflect what is needed to provide significant

stimulus to the entertainment sector to help increase exports.

Actions that should be taken by Governments in CARICOM

1. The import charges associated with the inputs to almost all creative activities stifle the

industry. Furthermore, there are no producers of music or electronic equipment in

CARICOM, so one cannot make a protectionist or infant industry argument. It would

appear that the high duties and taxes are revenue-seeking measures imposed by

CARICOM governments. Stimulating the development of the creative sector requires

resolution of this issue. These charges are a major disincentive and act as a direct

constraint on investment by the predominantly small firms and individuals in the creative

sector. CARICOM governments should unilaterally or collectively waive the tariffs and

41

other duties and charges on inputs to creative activities. A proposal regarding this issue

has been submitted by the Regional Cultural Task Force and its approval should be

expedited.

2. The movement of artistic materials (equipment and final products) within CARICOM is a

major challenge. Governments should immediately address this problem either by

joining the ATA Carnet system or developing a similar but simple regime in the context

of the CARICOM Single Market. The current administrative practices by customs

agencies in the region make it practically impossible for visual artists to show their works

in other CARICOM states and make it very difficult to move equipment that performing

and visual artists need to do their work. It is also an affront to the concept of a single

market and the fact that artists were in the first category of persons designated for free

movement by CARICOM heads of government.

3. Governments in CARICOM should think strategically about the local initiatives to

develop animation and support them in increasing animation’s connections and

commercial linkages with Canada, the UK, and other key markets. National investment

promotion agencies should target the animation sector in their outreach and try to

attract investment in this area by international firms. While animation is taught at the

Edna Manley College in Jamaica and at UTT, this is inadequate in terms of training

facilities for the development of an export-oriented animation industry. At the same time,

there is a need to research the value chains in the global animation industry and promote

linkages with them.

4. Financing of investment in creative projects is a major challenge in the Caribbean. In

Europe, a number of financial institutions specialize in investments for the creative sector

such as the IFCIC36

in France, the Audiovisual SGR37

in Spain and Ingenious38

in the

UK. However, the development of similar institutions in the CARICOM is unlikely under

the current attitudes toward the entertainment sector in Caribbean financial institutions

and little support by governments in the region to stimulate the sector. Further study on

these financial institutions and their methods to value the entertainment sector for lending

36 Institut pour le Financement du Cinéma et des Industries Culturelles (IFCIC) is a financial institution with a mandate from the Ministry of Culture and

the Ministry of the Economy and Finance to contribute to the development in France of cultural industries by facilitating these firms’ access to bank financing. As a neutral and autonomous entity, IFCIC is 49 percent owned by the State, OSEO Group, and La Caisse des Dépôts, and the rest by a

private shareholder committee, including almost all French banks (www.ifcic.fr). 37 See: www.audiovisualsgr.com . 38 See: www.ingeniousmedia.co.uk .

42

purposes could prove useful. While these European financial institutions may not be in

a position to provide technical assistance to the Caribbean, Caribbean governments

should discuss with them the key elements of their operation with respect to the criteria

for selecting creative projects for financing and advice that they provide to creative

entrepreneurs.

5. Establish National Endowment Funds for the Arts, to which the public and private

sectors can contribute money toward arts development. While governments in

CARICOM are unlikely to have significant resources to capitalize such a fund, they

should start with whatever amounts are feasible and provide very generous tax incentives

to companies and private persons who contribute to a National Endowment Fund for the

Arts. They can also appeal to their international partners and donor governments to

contribute to the fund. It is important to assist artists in developing their craft and

performances, thereby improving the sector in its broadest definition ― including music,

dance, drama, audio-visual productions (including multimedia), and visual arts. There

may also be a need for a regional fund for CARICOM-wide collaborations and

productions. In the case of the OECS sub-region, there should be one fund because

individual markets are too small.

6. Establish national databases of artists and cultural entrepreneurs in all CARICOM

countries, which are updatable on a continuous basis. This will serve to provide

repositories of contacts for the different sub-sectors and will serve as a marketing tool for

the industry as well as improve liaison between the private sector and government

officials. The tremendous information gaps that exist in this area were revealed by the

limited attempt in this study to compile a list of some of the major entertainment

personnel and companies in a few CARICOM states simply for illustration. While most

CARICOM governments say that they want to promote the cultural or creative industries,

and some even have dedicated agencies that have “adopted” the sector, no country has a

complete inventory of its professionals or companies in any of the various creative sub-

sectors. Some agencies claim that they would like to develop such an inventory, but they

have resource constraints.39

The closest that any country comes to having an example of

an inventory is the Film Company of Trinidad and Tobago, which has an impressive

39 In Trinidad and Tobago, the Ministry of the Arts and Multiculturalism is currently developing a National Registry of Artists and Cultural Workers,

and the Entertainment Company (TTent) is developing a national database of artists and cultural entrepreneurs.

43

2009 Production Directory consisting of 335 pages. It lists companies and professionals

in all areas of activity ranging from production and post-production to lighting, graphic

artists, and makeup. Many of these companies provide a wide range of services relating

to the film/video sector.

7. Build new facilities and infrastructure for artistic performances and practice. To date,

only Trinidad and Tobago has a major specialized facility for the performing arts in its

capital city. However, even there, local facilities do not exist in the rest of the country for

regular practice and rehearsals to develop talent and skills for any of the performing arts.

In the OECS, there are no public facilities that are up to professional standards. More

community-based investment would be in cultural centers with high-quality facilities for

the performing arts, which also allow for practice and training activities rather than just

special events.

8. Convert the irregular Caribbean Festival of Arts (CARIFESTA) into a full-fledged

professional Entertainment Trade Show in the Caribbean and attract a world-class

gathering to exhibit and promote Caribbean artists of various genres. This will require

tremendous regional cooperation and hitherto unheard–of cooperation between officials

and creative industry professionals in CARICOM, perhaps through export promotion

agencies rather than Ministries of Culture or Trade. However, it will provide a much-

needed forum for showcasing Caribbean talent to the key players from Europe, North

America, and Asia that purchase, promote, and distribute cultural products and services.

The success of Caribbean Fashion Week is a useful indication, but a dedicated regional

entertainment event should cover various activities ― music, dance, film/video, and

fashion ― and be focused on marketing what the Caribbean has to offer to specific

entities in global markets. An entertainment event such as this will have greater impact

for creative professionals in the region since very few are able to attend Marché

International du Disque et de l’Edition Musicale (MIDEM), WOrld Music EXpo

(WOMEX), and other such international events.

9. Collect market information and market opportunities for entertainers and other

Caribbean artists in the European Union, North America, Japan, and China on a

regular basis; mount trade missions, exhibitions, and related promotional events; and

advertise in the markets being targeted. The current mandate and activities of Caribbean

44

diplomatic missions in overseas regions seems to exclude economic intelligence

gathering. This is unfortunate since all consular offices and diplomatic missions have a

more diverse reach and purpose. Caribbean representations abroad should promote the

cultural strengths of their societies in a more strategic manner and seek opportunities for

their artists and entertainers. The connection between promoting these strengths and their

tourism objectives are obvious.

Recommended Technical Assistance/Aid for Trade Initiatives

1. Establish and implement a concerted marketing program for the entertainment sector

targeted at specific EU countries. This should include trade missions, trade fairs, and

other promotional events (television advertisements and Internet ads) in the EU, as well

as lobbying for participation of new Caribbean artists in the numerous musical and

performing arts festivals across Europe. At the moment, only well-known Caribbean

artists are invited to the festivals in different EU countries.40

The main initial thrust of the

marketing program should be music, carnivals, and the performing arts. In addition, the

associations of Caribbean professionals in the music, dance, and audio-visual sectors

should be linked electronically directly to the European Festivals Association41

and to

national festivals in Europe in order to target specific genres in countries of interest. The

promotion and marketing can be conducted by national export promotion agencies such

as JAMPRO and/or Coalitions of Service Industries (Barbados, St. Lucia, and Trinidad

and Tobago).

While a number of established artists have access to marketing services, many

others do not have the resources to promote themselves and gather information on their

target markets, even in the European Union where the EPA has formally granted

significant new market access for Caribbean entertainers. Sector-wide promotional efforts

could be launched to stimulate demand abroad for artists from CARICOM countries by

developing contacts with overseas promoters. The promoting agencies could then act as

points of referral for specific artists, thus providing an industry-wide benefit. Similarly,

research into potential markets for artists should be carried out, and the information,

40 Note that there are more than 20 music festivals in Belgium each year in which artists from developing countries participate. 41 See: www.efa-aef.eu/en/festivals/

45

including details of suitable live events, should be made available to artists or creative

professionals in CARICOM. This strategy should be rapidly developed for the wider

European Union markets, in particular the lesser known Eastern European countries that

are newer EU Members (EU-10). They might represent a totally untapped market for

Caribbean entertainers.

In addition, for younger artists and other creative persons, CARICOM states

should seek to establish sources of funding for artist exchanges with European countries

to take advantage of the provisions of the EPA Protocol on Cultural cooperation. Such

activities will lead to richer artistic collaboration and co-productions of all kinds and will

enhance appreciation for Caribbean cultural expression and outputs. Also, artist

exchanges and artists-in-residence programs will quickly give creative persons in the

Caribbean region a much better appreciation of the entertainment market in the EU and

provide contacts that will eventually lead to commercial contracts for lesser-known

artists.

2. Establish a Caribbean Entertainment Investment Fund (USD 10-15 million), from

which the private sector in CARICOM can access financing for commercially viable

projects. This initiative could also include public-private partnerships to build facilities

and infrastructure for the creative sector. Given the tremendous difficulties that all

entertainment companies and individual artists have accessing financing for activities in

the cultural sector, establishment of such a fund is critical to fostering investment. The

fund should be provided through a commercial banking or investment institution at

concessional or subsidized rates of interest. It should be intended to promote the

development of the sector and accommodate joint ventures across CARICOM states and

between foreign and Caribbean companies. An example of this type of fund is the USD

200 million Nigerian Creative and Entertainment Industry Stimulation loan scheme

established by the Nigerian Government in 2007.42

Funding interventions under the

scheme cover all segments of the entertainment industry and span all stages of a

production process in the various creative sectors discussed in this paper ― music, dance,

drama, film/audio-visual, the visual arts.

42 See: www.neximbank.com.ng/news_one.php?article=21.

46

3. National and/or regional entities need to help creative firms develop new short- and

medium-term strategies for creation, distribution, and exploitation of creative works.

Due to the small size of most CARICOM companies and a certain lack of business

strategy skills, the overseas markets remain a distant dream for these companies in many

sub-sectors of the creative industries. However, digital technology and increasing

international integration or globalization provide creative entrepreneurs with new market

opportunities. Where appropriate, innovation support services should help CARICOM

creative companies to access foreign markets and reach out to a larger potential customer

base. Creative people need to work with ICT specialists. Both need to be informed by

consumer demand, and both need to be able to grasp and implement business models that

commoditize the creative results of their synergies and collaboration.

Furthermore, most creative firms are undergoing a period of significant change

globally brought on by the effects of digital technology. The “digital shift” creates many

uncertainties but, at the same time, presents many opportunities. All CARICOM states

need to help creative companies benefit from this transformation. Creative firms also

need help to better understand and shape online consumption. While, internationally, a

few digital media sub-sectors of the creative sector (e.g., social media producers) are

already mastering the challenge of attracting vast numbers of users to their services,

traditional content creators would benefit from implementing more advanced digital

media strategies. For example, the question of how to best exploit media rights on digital

distribution networks is a long-term challenge for many small and medium-sized content

creators in CARICOM (and all over the world). Foresight and strategic partnerships are

needed to help these creators benefit to the greatest extent from digital technology in the

future.

4. Provide training for financial institutions in the Caribbean on how to value intellectual

assets (particularly copyright in music) and on risk assessment for investment projects

in the entertainment sector. This is a critical need in the CARICOM region since its

banks have no experience in lending to creative sector companies or individuals mainly

because they lack knowledge on the entertainment industry’s operations. There are some

47

well-known methodologies for valuing intellectual assets such as patents or copyright i.e.

income approach, discounted cash flow, venture capital method, relief from royalty, and

the real options method. These methodologies should be explored in the Caribbean

contexts to determine which are appropriate for the local circumstances and which can be

used by financial institutions in the region to provide financing for investors in the

creative sector, particularly in the music and audio-visual areas. This is an initiative in

which the Caribbean Development Bank might have some interest as well as the large

commercial banks.

5. Establish training institutions for the entertainment/arts sector, in particular, music

and the performing arts in countries in which they do not currently exist, and

strengthen existing training institutes. In the case of the OECS, since the countries may

be too small for national training facilities to be economically feasible, a sub-regional

facility or training scholarships should be provided for creative persons to study in

CARICOM states or abroad. At the same time, the industry associations in the different

creative genres in CARICOM states should seek to upgrade the standards in their

industry to remain or become more competitive.

6. Establish creative business incubators (i.e., low-cost shared facilities for creative

businesses, which are linked to arts schools or university arts departments and advised by

seasoned local and foreign industry professionals) that offer opportunities for students to

take their first steps in business in a supportive environment. The incubators should be

funded by the public sector or donors, but with collaboration with private-sector interests.

This process can be linked to the establishment of creative clusters composed of research

centers and arts schools. Indeed, the collaboration among artists, designers, and

technologists opens new ways to create innovative products and services and fosters

innovative solutions at the interface of creativity and technology in a wide range of areas.

7. Set up a regional initiative to promote the use of design and/or art in business to

develop competitive edges, for example through “artists-in-residence” projects in which

companies invite artists to spend some time among their employees in order to encourage

48

mutual exchange and dialogue. Such projects enable both sides ― employees and artists

― to discover different ways of thinking and producing. They also make employees think

about their views on the company and their working environment. The artists-in-

residence projects will facilitate greater intra-CARICOM collaboration on creative

projects and cross-fertilization of creative ideas, and will enhance the creative output of

individual countries and the region as a whole.

49

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53

Annex I

Roadmap for a Trade Promotion and Marketing Program in Selected

European States

Given the small size of CARICOM, the development of markets outside the Caribbean is

essential to the economic success and growth of the Caribbean entertainment industry. The

Economic Partnership Agreement (EPA) signed between the CARIFORUM countries and the

European Union in October 2008 provides significant opportunities for the countries’ market

access in the European entertainment sector and for cooperation on cultural activities in a range

of artistic genres. It is, therefore, recommended that a technical assistance program target the EU

entertainment market and help Caribbean entertainers and other artists take advantage of the

opportunities in the different European countries. This will require collaboration between public-

and private-sector entities at the national and regional levels.

A program of donor support should consider the following activities:

1. European Entertainment Market Intelligence Reports

Provide resources for the commissioning and preparation of specialized entertainment

market reports on: (a) the specific requirements of, and other details on, the annual

national festivals that feature world music (which include Caribbean musical genres) in

selected EU Member States; and (b) the specifics of the regular commercial market (size,

demographics, consumption patterns, etc.) for live and downloadable Caribbean music in

Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, the Netherlands,

Portugal, Spain, Sweden, and the United Kingdom. These market reports should explain

the regulatory procedures for getting contracts and work permits, and for mandatory

payments such as withholding taxes. They should also explain how economic needs tests

operate in practice in each jurisdiction. This exercise should result in clear, simple, and

easy-to-follow brochures for entertainers from CARICOM on the opportunities and

regulatory requirements in each EU country for Caribbean entertainment services,

particularly live music. Relevant agencies in CARICOM for this activity: Ministries of

Trade in collaboration with entertainment industry associations (Budget: EUR 400,000).

54

2. Online Music Platforms

Provide technical assistance and support to music and entertainment industry associations

in Barbados, Jamaica, the OECS, and Trinidad and Tobago to help establish relevant

commercial e-commerce platforms for the sale/distribution of music online by

independent artists43

. This will require that artists/musicians be informed about contracts

in the online medium and collaborate with their relevant copyright organizations to

provide for electronic distribution of their music or performances. Technical

infrastructure will have to be installed to establish an e-commerce facility for commercial

music downloads in regional and/or national copyright/collection agencies. Relevant

agencies in CARICOM for this activity are: Caribbean Copyright Link; Eastern

Caribbean Copyright Organization; Caribbean Music Managers Forum; Barbados

Association of Music Entrepreneurs, COSCAP; Belizean Society of Composers Authors

Publishers (BSCAP); Jamaica − Reggae Industry Association, Federation of Musicians,

and Association of Composers, Authors, and Publishers; Trinidad and Tobago − COTT,

Recording Industry Association, and Trinbago Unified Calypsonians Organisation. The

project can be executed by COTT on behalf of the other organizations (Budget: EUR

300,000).

3. Trade Missions to Select EU Member States

Provide technical assistance and support for conducting creative industry trade missions

to the newer EU Member States (Bulgaria, Czech Republic, Estonia, Latvia, Malta,

Poland, Romania, Slovenia, and Slovakia) to develop contacts in the entertainment sector

and culture ministries and promote the services of the Caribbean region’s entertainers,

animators, filmmakers, and fashion designers, and to promote the Caribbean as a tourism

destination. Relevant agencies in CARICOM for this activity: Ministries of Trade in

collaboration with entertainment industry associations and tourism departments (Budget:

EUR 700,000).

43 Independent artists are those that are not contracted to international music labels or companies that have their own distribution networks and channels.

55

4. Mechanisms to Utilize the EPA Protocol on Cultural Cooperation

EU Member States have indicated that the Cultural Protocol in the EPA is demand-

driven. It is, therefore, critical for CARICOM countries to articulate their interest in

specific areas of cultural activities. It is recommended that technical and financial support

be provided at the national level to prepare proposals for requests to specific EU states

for cultural cooperation activities under the EPA Protocol. These proposals should

include all of the performing arts and visual arts, and provide for artists in residence,

artist exchanges (in Europe and in the Caribbean), training workshops, and other related

activities. Relevant agencies in CARICOM for this activity: national ministries

responsible for Culture and for Trade (Budget: EUR 400,000).

5. Negotiation of Audio-Visual Co-Production Treaties

Provide technical assistance and support to initiate bilateral discussions with the United

Kingdom, Germany, France, Belgium, the Netherlands, Ireland, and Spain and negotiate

co-production treaties for the audio-visual sector to provide opportunities for Caribbean

creative persons to collaborate with European counterparts on joint projects. In the case

of the UK, the current co-production treaty with Jamaica will need to be updated/revised

and extended to the rest of CARICOM. A starting point for this activity is the report

prepared in 2011 for the CARICOM Office of Trade Negotiations on a Model Co-

Production Treaty for CARIFORUM (Smith, 2011). Under the EPA Protocol on Cultural

Cooperation, co-production treaties are necessary to have co-produced audio-visual

works treated as European and Caribbean works, respectively, and to qualify for funding

under European audio-visual programs. Activities envisaged are visits to European

capitals to discuss audio-visual co-production issues and recruitment of technical

expertise to assist in negotiating co-production treaties with European counterparts.

Relevant agencies in CARICOM for this activity: National Film Boards and audio-visual

and film associations in collaboration with national Trade ministries (Budget: EUR

200,000).

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Annex II

Entities with which International Donors Can Discuss Entertainment Projects

in CARICOM States

As is the case in most developing countries, except perhaps to some extent Brazil, CARICOM

governments, Culture ministries are often weak. As a result, these ministries seriously lack the

resources (human and material) to assist the creative sectors. Furthermore, in spite of what

various Caribbean governments say about the importance of cultural industries, Culture

ministries have yet to conceptualize their role as promoting the creative sector as an economic

sector. They are still focused on old models of culture as mainly a means of promoting national

identity. Their budgets and work programs are all generally limited to specific events on the

annual calendar. In Culture ministries, where cultural policies are developed, there is little

strategic thinking and there are no plans for economic development of the creative or cultural

industries as an export sector.44

This poses a bit of a problem with respect to liaison between donors and national

governments in terms of locating a project focused on the entertainment sector. In the case of

Jamaica, the relevant agency would clearly be Trade and Invest Jamaica (JAMPRO) since it has

a specific focus on the creative industries. The Jamaican Ministry of Youth, Sports, and Culture

seems to be under-resourced and perhaps more focused on sports at the moment, notwithstanding

the fact that the current minister has roots in the creative sector.

In terms of Trinidad and Tobago, depending on the nature of the initiative, the contact

could be the Ministry of Trade and Industry (under which TTent and TTFC fall) or the two

agencies themselves since they are capable of signing international agreements. An alternative,

and perhaps more relevant, entity is the Trinidad and Tobago Coalition of Services Industries

(TTCSI), which interfaces with and acts on behalf of several sectors. The TTCSI can more

rapidly execute a project than the Ministry can, and it is already seeking mechanisms to help its

members take advantage of opportunities in the entertainment sector in Europe. One interesting

44 It is instructive that both the Entertainment Company (TTent) and the Film Company (TTFC) were created by the Ministry of Trade and Industry in

Trinidad and Tobago. Another agency in this country is responsible for Carnival: the National Carnival Commission.

57

initiative is a plan by the National Carnival Development Foundation (NCDF) to conduct a trade

mission of carnival bandleaders to five EU states in 2012.

In Barbados, perhaps the National Cultural Foundation may be one option since the

Culture Ministry seems unable to do much directly with the cultural practitioners due to its

official procedures and policy changes from government to government. The same applies to the

Ministry of Foreign Affairs and Foreign Trade. If the focus of the project is the private sector,

then the Barbados Coalition of Service Industries (BCSI) may be the best option in this regard. It

has been very active in seeking new markets for its members and conducting trade missions and

other business-to-business activities. There are also some key national creative industry

associations in its membership. The BCSI has also articulated its interest in some specific

creative industry projects.

In the OECS states, since industry associations are weak or non-existent, the source of

any aid for trade initiatives for the entertainment sector would most likely have to be the

Ministries of Culture or Trade or Planning. In the case of St. Lucia, the appropriate entity would

be the Cultural Development Foundation, and, in Grenada, it would be the Grenada Cultural

Foundation.

An indicative list of artists and companies in CARICOM’s creative sector as well as a list

of relevant contact points/agencies at the national level in the Caribbean through which technical

assistance or capacity building programs may be obtained by contacting the author.